How do I start a career in private equity?
Private equity firms typically hire candidates with degrees in finance, business administration, or accounting. An in-depth knowledge of financial modeling, valuation, and accounting is also crucial. Exceptional analytical and problem-solving skills are necessary to get started in private equity.
Private equity firms usually look for entry-level associates with at least two years of experience within the banking industry. Investment bankers usually follow the PE firm career path as their next job and typically have a bachelor's degree in finance, accounting, economics, and other related fields.
Get into private equity right out of college
Although most private equity firms prefer not to hire and train graduates, but instead get someone with a few years of investment banking experience, you can still find a private equity role as an undergraduate.
While investment banking is by far the most common training ground for private equity, it is also possible to recruit for private equity roles after doing entry-level consulting, especially if you are a top performer at a top management consulting firm.
Demonstrating an astute understanding of the factors that influence successful investments, such as sound financial analysis, robust due diligence, and an ability to foresee potential growth drivers, solidifies your position as a promising candidate.
Candidates should have an bachelor's degree in an analytical major like finance, accounting, statistics, mathematics, or economics.
For the vast majority of first-year private equity associates, the base salary is around $135k to $155k. Then, based on fund performance, bonuses tend to range from 100% to 150% of the base salary.
The Cold, Harsh Truth About Low Grades
If you've earned a low GPA over several years, industries such as investment banking and private equity are probably not right for you.
Nearly all the large private equity firms (“mega-funds”) offer some form of internships to undergrads: KKR, Blackstone, Ares, Silver Lake, Carlyle, TPG, Apollo, and, on the European side, firms like Cinven, CVC, Bridgepoint, EQT, and Permira.
Full-Time Program. Students in their last year of undergraduate studies or in their second year of business school with an anticipated graduation date in the spring may apply for our full-time Analyst and Associate positions.
Is PE more prestigious than IB?
While both careers are highly regarded and financially lucrative, the choice is personal. Investment banking is typically viewed as glamorous but also requires longer hours and the sacrifice of a personal life. Private equity is extremely prestigious.
Private Equity Analyst Salary + Bonus: You'll almost certainly earn less than an IB Analyst in terms of total compensation; your salary + bonus will likely be in the $100K – $150K range, with the bulk coming from your base salary.
However, investment bankers tend to work longer hours, often working late into the night and on weekends. Private equity firms also tend to have a more relaxed work environment and offer more flexible hours. So, if you're looking for a career with less hours commitment, private equity may be the way to go.
To break into private equity, a strong educational background is essential. Most professionals have degrees in finance, business, or related fields. Relevant experience in areas like investment banking or consulting is highly regarded.
Private equity firms are always on the lookout for candidates who can think outside the box and bring fresh ideas to the table. They want to know that you are able to analyze complex financial data, identify potential investment opportunities, and make sound investment decisions.
but nowhere near as much as in management consulting. While the travel will be less, the work in private equity is very stressful and demanding, so the hours you actually spend working may be more stressful or mentally demanding.
Private equity is ownership or interest in entities that aren't publicly listed or traded. A source of investment capital, private equity comes from firms that buy stakes in private companies or take control of public companies with plans to take them private and delist them from stock exchanges.
In my opinion, the techniques used to model PE transactions have a lot in common with those that are applied to Listed Equity. It has some maths in it, but nothing out of the world! 1) Not much in my experience in PE or IB.
The minimum investment in private equity funds is typically $25 million, although it sometimes can be as low as $250,000. Investors should plan to hold their private equity investment for at least 10 years.
Private equity investing often have high investment minimums, which can magnify gains but also magnify losses. Liquidity risk exists since private equity investors are expected to invest their funds with the firm for several years on average.
How many hours do you work in private equity?
Private Equity Associate Lifestyle and Hours
At many smaller funds and middle-market funds, you can expect to work 60-70 hours per week, mostly on weekdays, with occasional weekend work when deals heat up.
| Annual Salary | Weekly Pay | |
|---|---|---|
| Top Earners | $241,298 | $4,640 |
| 75th Percentile | $187,500 | $3,605 |
| Average | $143,004 | $2,750 |
| 25th Percentile | $113,500 | $2,182 |
Q: What are your GPA requirements? A: We value diverse degree backgrounds and experiences and while a GPA 3.2 (or equivalent) in your undergraduate degree is preferred it is not required. Our training programs are designed to allow everyone, regardless of major studied to succeed.
Goldman Sachs does not give a specific minimum GPA requirement, though some sources suggest a GPA of at least 3.6 is preferred. Additionally, you may need to show relevant coursework and hard skills for certain programs.
Does GPA Matter for Investment Banking Jobs? Yes, GPA matters! Bulge bracket banks and almost all other investment banks will look at your GPA when applying for a job and you should include it in your resume. Typically banks screen resumes based on GPA and will often remove anyone below 3.5.
